How to Prepare a Pay Stub for Overtime
Generally, a pay stub reflects the employee's gross earnings, voluntary deductions, federal and state taxes withheld, and net pay. The employee's gross earnings are based on his hours worked---typically, his regular and overtime hours. Therefore, if an employee works overtime hours, the hours worked should be reflected on his pay stub. Including an employee's overtime hours on his pay stub is done with the processing of his regular hours.
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Instructions
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1
Figure the total overtime to be paid. Generally, hourly employees are eligible for overtime pay so long as they work 40 hours for the week. Employers require that hourly employees complete weekly time cards. Refer to the time card to determine the amount of overtime hours to pay the employee for the week. Add the hours worked each day, and ensure that the employee has at least 40 regular hours. Pay the excess hours as overtime.
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2
Enter the overtime hours in the payroll system, coding accordingly. Ensure that the employee is receiving his overtime hours at time and a half. For instance, if his regular pay rate is $10 and he has 5 overtime hours, calculate as follows: 10 (hourly rate) x 1.5 (time and a half) = $15 (overtime rate) x 5 (overtime hours) = $75 (overtime compensation).
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3
Print the pay stub. Using the example in Step 2, the employee's pay stub will reflect his overtime details on a separate line (usually underneath the regular hours). The overtime details include the overtime hours, overtime pay rate and overtime pay.
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Tips & Warnings
If you do not have payroll software, go to paycheckcity.com and sign up for a free membership. Select the basic package, and choose the hourly calculator. Follow the prompts to make a free pay stub, which has the option to include overtime hours.
